Govt may take the land pooling route for expressway and bypass projects

The move will help acquire space to build roads, offering a possible way out for a seemingly intractable obstacle in the way of all infra development.Rajat Arora | ET Bureau | August 29, 2015, 17:23 IST

The move will help acquire space to build roads, offering a possible way out for a seemingly intractable obstacle in the way of all infra development. NEW DELHI: The government proposes to return a substantial proportion of developed land along proposed expressways and city bypass projects to owners for commercial development. The move will help acquire space to build roads, offering a possible way out for a seemingly intractable obstacle in the way of all infrastructure development in India.

"We will allow land pooling for all expressway and bypass projects," Union roads minister Nitin Gadkari told ET, adding that the states were agreeable to this. The plan is for as much 40% of the land acquired to be given back to the original owners, ready for commercial development.

An official cited the experience of Andhra Pradesh in this regard as the state looks to build a new capital.

The model will hasten acquisition for future projects and go a long way toward overcoming stumbling blocks when it comes to buying land for road projects. Since the land will have to be pooled with the help of the states, the ministry had called a special meeting with all chief secretaries to take the idea forward.

"The land can be used for setting up education hubs, transport and medical hubs and other services. Farmers will be able to benefit from the upside in prices of land post development," said Gadkari, who has set himself the task of reviving road building after it slowed under the previous government. India is looking to lay 30 kilometres of roads everyday by March next year, more than double 14 km now.

The Narendra Modi government has failed to get the 2013 land acquisition law, regarded by it as too restrictive, amended because of opposition resistance on the ground that the move is unfair to farmers.

Most of India's infrastructure projects have foundered on land acquisition and the pooling plan offers a way out.

Keen to get around the 2013 law, some states have already begun work on land pooling.

"Andhra Pradesh has already set an example in land pooling and shown everyone the way to overcome land acquisition troubles," said the ministry official cited above. Chief minister Chandrababu Naidu has made a start on his plan to construct the state's new capital city Amaravati on 34,000 acres of agricultural land by making all farmers stakeholders. Those who opt for pooling will get 30% of the developed land back.

"Land pooling is now a proven mechanism for executing public projects that require large amounts of land and where the projects lead to significant increase in the land value," said Jaijit Bhattacharya, partner, infrastructure, KPMG. "Land holders have enthusiastically participated in this land pooling mechanism for Amaravati, Andhra Pradesh."

The Modi government had issued an ordinance to relax the land acquisition law in anticipation of parliamentary approval for the amendment, which hasn't been forthcoming.

The amendment is currently being examined in committee but the government seems to have gone back on most of the proposed changes. Instead, it's banking on the states to come up with initiatives such as pooling.

"Once the land ordinance lapses, the land acquisition bill 2013 will come into force and with conditions of that bill, acquisition of land will be a long-drawn process leading to stalling the development of the sector," a senior government official said. The roads sector has been facing long delays because space can't be acquired.

"It is observed that the land acquisition is one of the reasons for delay of completion of projects," minister of state for road transport and highways Pon Radhakrishnan had informed the Rajya Sabha in March.

Economic analyses suggest that 43% of all stalled projects face land acquisition problems. Land accounts for about 45% of the total cost of building highways.

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